TIDMCIU
RNS Number : 7302B
Cape plc
06 April 2017
Cape plc
6 April 2017
6 April 2017
Cape plc ('Cape' or the 'Company')
Annual Financial Report
Cape announces that its Annual Financial Report for the year
ended 31 December 2016 (the "2016 Annual Report"), the Notice of
Annual General Meeting ("Notice of AGM"), form of proxy ("Form of
Proxy") and a letter requesting the sending of documents and
information by electronic means ("Electronic Documents and
Information Letter") have today been mailed to Ordinary
Shareholders and the Scheme Shareholder (as defined in the
Company's Articles of Association).
Pursuant to Listing Rule 9.6.1, the 2016 Annual Report, Notice
of AGM, Form of Proxy and Electronic Documents and Information
Letter have been submitted to the National Storage Mechanism and
will shortly be available for inspection at:
www.Hemscott.com/nsm.do and can also be viewed on the Company's
website at www.capeplc.com.
AGM Location
The Company's AGM will be held at 10.00am (BST) on Wednesday, 10
May 2017 at the offices of Cape at Drayton Hall, Church Road, West
Drayton, Middlesex UB7 7PS, United Kingdom.
Additional Information
In accordance with Disclosure and Transparency Rule 6.3.5(2)(b),
additional information is set out in the appendices to this
announcement. This information is extracted in full unedited text
from the Annual Report. References to page numbers are the
respective page numbers in the Annual Report. This information is
not a substitute for reading the full Annual Report.
Cape plc
Richard Allan
Company Secretary
Appendices:
Appendix 1: Directors' Responsibility Statement
The following directors' responsibility statement is extracted
from the 2016 Annual Report (page 79).
Directors' responsibilities
The directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable laws and
regulations. The directors are also responsible for the
preparation
of the directors' remuneration report, which they have chosen to
prepare, being under no obligation to do so under Jersey law ('the
Law'). The directors are also responsible for the preparation of
the Directors' governance report under the Listing Rules.
Jersey company law requires the directors to prepare financial
statements for each financial period in accordance with generally
accepted accounting principles prescribed for the purposes of the
Law. Pursuant to that Law, the directors have prepared the Group
consolidated financial statements and the parent company financial
statements in accordance with International Financial Reporting
Standards (IFRSs) as adopted by the European Union (EU).
The financial statements are required by law to give a true and
fair view of the state of affairs of the Company at the period's
end and also the profit or loss of the Company for the period then
ended. In preparing those financial statements, the directors
should:
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable;
- state that the financial statements comply with IFRSs as
adopted by the EU, subject to any material departures disclosed and
explained in the financial statements; and
- prepare the financial statements on the 'going concern' basis
unless it is inappropriate to presume that the Company will
continue in business, in which case there should be supporting
assumptions or qualifications as necessary.
The directors are responsible for keeping adequate accounting
records which are sufficient to show and explain the Company's
transactions and as such to disclose with reasonable accuracy at
any time the financial position of the Company and to enable them
to ensure that the financial statements comply with the law. They
are also responsible for safeguarding the assets of the Company and
the Group and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation in Jersey governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
Responsibility statement under the Disclosure Guidance and
Transparency Rules
Each of the current directors, whose names and functions are
listed on page 52 of the 2016 Annual Report confirms that, to the
best of his/her knowledge:
- the consolidated financial statements, prepared in accordance
with IFRS as adopted by the EU, give a true and fair view of the
assets, liabilities, financial position and profit of the Group and
the undertakings included in the consolidation taken as a whole;
and
- the Directors' governance report (including the corporate
governance report and the Audit Committee report) on pages 50 to 81
of the 2016 Annual Report and the regional and Chief Financial
Officer's reviews on pages 18 to 30 of the 2016 Annual Report
include a fair review of the development and performance of the
business and the position of the Group and the undertakings
included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face
as set out in the principal risks and viability review on pages 34
to 39 of the 2016 Annual Report.
Directors' statement under the Corporate Governance Code
The Strategic report and this directors' governance report
(including the remuneration report) were reviewed and approved by
the Board on 14 March 2017. The Board confirms that, taken as a
whole, these reports represent a fair, balanced and understandable
report on the Group's performance, business model and strategy.
By order of the Board
Michael Speakman
Chief Financial Officer
14 March 2017
Appendix 2: Principal Risks & Uncertainties
The following description of the principal risks and
uncertainties that the Company faces is extracted from the 2016
Annual Report (pages 32 to 39).
Cape recognises that in a dynamic operational and business
environment, it is essential that we actively manage our risks and
opportunities to allow us to meet the Group's strategic objectives
and deliver value to our shareholders. Our risk management
procedures allow the Group to identify, assess and manage risk to
an acceptable level while pursuing our strategic objectives and
protecting and enhancing our reputation.
How we manage risk
Following Cape's values in everything we do
Whilst Cape is focussed on seeking opportunities and delivering
our objectives, we must do so by working in accordance with our
values. We firmly believe that adopting responsible behaviour at
every level and in every aspect of the business is key to our
success and this is our first line of defence in risk management.
Our values, visible adherence to our values and the reinforcement
of them has created a strong culture of risk awareness within the
business.
For more information go to page 41 of the 2016 Annual Report
Operations are accountable and maintain an effective risk
mitigation framework
Our employees work across many different geographies and provide
a wide range of services, which presents a range of risks. Our
employees take accountability for identifying and effectively
managing risks, using the Group's thorough system of policies and
procedures. Internal control procedures are maintained on a
day-to-day basis, risk registers are in place and training is
assessed, to ensure the appropriate knowledge and skills are in
place where and when they are needed.
Our independent risk management and compliance functions
determine appropriate frameworks for managing risk
Independent functions, such as Health and Safety, Finance,
Legal, Commercial and Operational Excellence, determine: the
appropriate frameworks; set standards for managing risk; provide
oversight for specific risk areas; collaborate with project and
process owners on controls to mitigate identified risks; and ensure
standards are implemented by process owners consistently across
Cape.
Internal audit provides independent challenge
Our Internal Audit function reviews financial controls and risk
management procedures throughout Cape, identifying risks, issues
and opportunities for improvement and then reporting to the
Executive Management and Audit Committee on these matters,
including updates on progress made against open items.
The Board and Executive Management provide assessment and
governance
The Board and Executive Management are actively engaged in
assessing strategic risk and providing oversight. The Audit
Committee formally reviews the results of the risk assessment
process twice a year and reviews internal audit assurance work
throughout the year.
For more information go to page 60 of the 2016 Annual Report
Our risk monitoring process
Analysing risks
- Risks are evaluated to establish potential financial and
non-financial impacts, the likelihood of occurrence and the root
cause. Risk is assessed formally at business unit level through
risk workshops and the continual maintenance of risk registers.
Every six months, a focussed bottom-up risk assessment is
undertaken by all business units which results in a prioritised
register of risks. A top-down assessment of operational and
strategic risk is undertaken by the Board and Executive Management
at least annually. The two processes are compared for profile and
gaps and are factored into Cape's final risk analysis.
Risk mitigation
- We review the nature, adequacy and appropriateness of our
current controls to mitigate these risks. If new, different or
additional risks are identified, or if additional controls are
required, these are developed and appropriate responsibilities to
discharge are assigned. Acquisition and other investment-related
risks are identified and assessed before key investment decisions
are made. A comprehensive and rigorous bid authorisation model is
used to evaluate the Group's risks when bidding for work and before
contractual commitments are made.
Reporting and monitoring
- Risks are monitored throughout the year by the Executive
Management and summarised to the Board. Emerging risks are
identified, reported and reviewed on an ongoing basis, with
particular focus on capturing emerging risk and monitoring all
changing risk during monthly business reviews. Management is
responsible for monitoring weakness in controls and progress of
actions taken by business units to mitigate the key risks; this is
supported through the Group's internal audit programme. The results
of the risk management process are reported to the Audit Committee
every six months.
For more information go to page 60 to 64 of the 2016 Annual
Report
Risk appetite
The Group's risk appetite drives high standards of health,
safety and environmental compliance, strong commercial risk
controls and financial management that collectively allow growth
whilst limiting the Group's risk exposure to an acceptable level.
The level of risk is considered appropriate for Cape to accept in
achieving our strategic objectives and is determined in accordance
with the Board's strategic reviews and risk assessments during the
year.
2016 assessment of principal risks
The risk assessment exercise is undertaken by each business unit
and independent group function who conduct a formal review of the
risks that could impact their activities. The assessment includes
the perceived level of risk and likelihood of occurrence, both
before and after mitigating controls. The impact of risks were
quantified across a range of factors including: financial, health
and safety, environmental, enforcement and reputational. The
Executive Committee separately discussed the Group's principal
risks in December to form a top-down assessment and oversight from
a Group-wide view. The Board also reviewed and challenged the
Group's assessment of risks, supported by the information obtained
through the 'deep-dive' reviews of anti-bribery and anti-corruption
and taxation, to arrive at the agreed principal risks.
Following these risk reviews, the Board noted that the Company
is exposed to increasing IT--related financial risks, reflecting in
part the increase in external cyber security threats. Consequently,
IT--system and cyber risks have been added to the Group's principal
risks and are explained in more detail in the following pages:
Please see table set out on page 33 of the 2016 Annual
Report.
A Global political, security G Preservation of Company
and economic conditions assets and investment
B Key customer and market H Compliance and business
dependency conduct risk
C Health, safety and I Industrial Disease
environmental (HSE) risks Claims -
provision adequacy risk
D Recruitment and retention J Industrial Disease
of key executives and Claims -
skilled employees widening of the scope
and liability
E Contract acceptance K Tax and treasury risks
risk
F Operational and project L IT-System and cyber
performance risk risks
Principal risks and viability
Risk Risk description Link to Mitigation Change More information
strategy in risk within
during the 2016
2016 Annual
Report
---------------- --------------------- --------------- --------------------- ---------- -------------------------
A. Global There - Geographic - A diverse Please Corporate
political, is a potential expansion portfolio see page and social
security impact - Balanced reduces 34 of responsibility
and economic on the business exposure the 2016 section
conditions Group to each Annual (security)
from political, specific Report page 43
security location, Our markets
and providing page 12
economic diverse Cape at
conditions revenue a glance
globally. streams page 2
We operate - Dedicated
across Group
the globe Head of
and Security
therefore responsible
may be for regular
exposed security
to adverse and risk
situations assessment,
with potential monitoring
risk to alert
our people, and escalation
assets procedures
and business - Improved
operations. contingency
Examples plans
of such and evacuation
risks strategies
would developed
be geo-political - Travel
events, by Cape
sanctions, employees
terrorist is monitored
events, and restricted
disease in countries
outbreaks deemed
or environmental unsafe
hazards. or too
Deterioration high risk
in commodity - Legal
prices Counsel
affecting monitors
customer any changes
capital in sanctions
and operational legislation
expenditure - Senior
is a key management
risk. presence
Although in all
we operate regions
over a - Reviews
number of the
of sectors, Group's
we are forecast
at risk and market
of trends
declining are completed
revenue quarterly
streams, along
contract with the
renegotiation Group's
and incurring strategic
costs annual
which planning
are not process
supported to ensure
by revenue any impacts
during from the
economic economic
downturns. environment
are managed
- Contract
performance
reviewed
monthly
by Finance
and Commercial
management,
with those
deemed
high risk
escalated
to the
Audit
Committee.
This allows
any changes
to expected
performance
or
impact
of economic
downturns
to be
identified
early,
reviewed
in the
context
of the
Group's
risk appetite
and any
necessary
action
taken.
---------------- --------------------- --------------- --------------------- ---------- -------------------------
B. Key Loss of - Customer - Group Please Our markets
client key customers intimacy strategy see page page 12
and market or decline - Balanced focussed 34 of Cape at
dependency in a key business on creating the 2016 a glance
market - Operational a broad Annual page 2
could excellence portfolio Report
adversely of
affect customers
Cape's and markets
financial - Acquisitions
performance. bring
The Group's new customer
top ten relationships
customers and wider
represented opportunities
54% of - Customer
revenue relationships
(2015: are built
45%) and at multiple
if we levels
are unable from site
to supervisors
continue to senior
working management
for one - Revenues
or more are generated
of our from a
key customers, wide variety
the Group's of service
future offerings
prospects across
may be numerous
impacted. markets
There and different
is the geographies
risk of providing
revenues greater
being stability
too concentrated and robustness
on a particular of revenue
market. streams
Working - Work
capital performed
may be throughout
impacted asset
if key life cycles
customers providing
look to opportunities
extend at each
payment stage
terms - Multi-year
or reject contracts
invoiced in place
revenues. - Monthly
contract
performance
reviews
by Finance
and
Commercial
management
to identify
and escalate
high risk
areas
- Risk
based
credit
control
procedures
are carried
out before
contracts
are bid
- Debt
exposures
are monitored
during
contract
lives
and firm
operational
decisions
are taken
when limits
are approached
or breached
- Operational
excellence
initiatives
seek to
improve
customer
retention
by increasing
efficiencies
and enhancing
customer
relations
and satisfaction
---------------- --------------------- --------------- --------------------- ---------- -------------------------
C. Health, The Group - Geographic - HSE Please Corporate
safety may suffer expansion reporting see page and social
and commercial - Operational on both 34 of responsibility
environmental and reputational excellence leading the 2016 section
(HSE) damage and lagging Annual (health
risks as a indicators Report and safety)
result monthly page 43
of a safety to the to 45
or environmental Executive
incident Committee
involving and to
our employees, the Board
members - High
of the number
public of site
or third-party based
partners. HSE personnel
Failure in all
to maintain regions
high - Investment
HSE standards in training
could to improve
result staff
in injury skills
or loss and ensure
of personnel, qualifications
breach are up
of regulations, to date
financial - HSE
loss and initiatives
reputational rolled
damage. out throughout
Financial the year
penalties, to raise
which awareness
in the - HSE
UK are policies
significantly and procedures
increasing, in place
in respect and monitored
of HSE throughout
incidents all regions
may be
incurred.
---------------- --------------------- --------------- --------------------- ---------- -------------------------
D. Recruitment The inability - Geographic Monitor Please Directors'
and retention to recruit expansion employee see page remuneration
of or retain - Customer turnover 34 of report
key executives both key intimacy and conduct the 2016 page 65
and skilled executives - Broaden exit interviews Annual to 77
employees and skilled portfolio - Training Report Corporate
employees - Operational programmes and social
could excellence implemented responsibility
adversely at all section
impact levels (people)
the Group, of Cape page 42
both operationally including
and financially. programmes
Strategic aimed
objectives at executives,
may not senior
be advanced leaders,
without future
the leaders,
industry site managers
knowledge and supervisors.
and experience Skilled
possessed employees'
by key training
executives, is
senior monitored
management and refreshed
and skilled as required
employees. - Executive
The availability remuneration
of suitably is reviewed
skilled against
employees market
can differ data to
significantly ensure
between awards
different are competitive.
geographies. Long-term
Visa restrictions, incentive
which plans
are increasing are in
in certain place
key countries, to
can impact encourage
employee the retention
availability. of the
key management
group
- Availability
of skilled
employees
has improved
in some
geographies
as projects
complete
and other
projects
become
impacted
by regional
economic
conditions
- Broad
portfolio
of services
and geographic
footprint
provides
employee
development
opportunities
- Software
to track
status
of new
and previously
employed
skilled
people
is operating
across
all regions
---------------- --------------------- --------------- --------------------- ---------- -------------------------
E. Contract There - Geographic - Policies Please Audit
acceptance is a risk expansion and procedures see page Committee
risk that Cape - Operational in place 36 of report
may fail excellence for contract the 2016 page 61
to manage - Broaden approval Annual to 64
contract portfolio include Report
risk and bid approval
commit models,
to contractual peer review
terms and Board
and conditions approval
that expose of key
the Group contracts
to excessive - Experienced
financial management
risks teams
and potential in place
cost overruns. for all
service
offerings
with the
relevant
technical
and industry
knowledge
- Dedicated
Estimation
and Commercial
teams
are in
place
in all
regions
- Commercial
management
report
on high
risk contracts
to senior
executives
and the
Audit
Committee
---------------- --------------------- --------------- --------------------- ---------- -------------------------
F. Operational Inefficient - Geographic - Operational Please Audit
and project project expansion excellence see page Committee
performance execution - Customer initiatives 36 of report
risk and management intimacy have been the 2016 page 61
could - Broaden implemented Annual to 64
lead to portfolio and Report
additional - Operational subsequently
costs excellence further
being developed
incurred, each year
affecting as part
overall of continuous
project improvement
performance programmes;
and the standardised
Group's global
financial project
performance. delivery
As our system
range framework;
of services continuing
and to develop
geographies and formalise
broaden, best practice;
the number and knowledge
of project sharing
types across
and styles the Group
expand, through
increasing centres
this risk. of excellence
- Cape
Management
Development
Programme
provides
training
to all
levels
of employees
and includes
project
management
and
financial
management
skills
- Implementation
of site
based
IT systems
that monitor
projects
and support
project
managers
- Monthly
project
performance
reviews
are undertaken
involving
finance,
commercial
and operational
personnel
- Audit
Committee
regularly
review
commercial
contract
risks
with
the Chief
Executive
and Chief
Financial
Officer
---------------- --------------------- --------------- --------------------- ---------- -------------------------
G. Preservation Return - Geographic - Due Please Audit
of Company on invested expansion diligence see page Committee
assets capital - Broaden assessments 36 of report
and investment may decrease portfolio undertaken the 2016 page 61
if there - Operational prior Annual to 64
is a failure excellence to acquisitions, Report
to achieve the formation
satisfactory of joint
returns venture
on assets, arrangements
acquisitions, and other
joint investments
ventures - Asset
or other control
investments. policies
At 31 and procedures
December, in place
Cape held globally
GBP84.0 - Group
million Head of
of property, Assets
plant responsible
and equipment for the
around co-ordination,
the globe utilisation,
and the supply
inadequate and relocation
management of assets
and financial worldwide
control - Standardised
of remote asset
assets management
may expose systems
the Group being
to losses. rolled
out across
all countries
giving
improved
visibility
of asset
location
and condition
- Asset
counts
performed
annually,
including
impairment
assessments
---------------- --------------------- --------------- --------------------- ---------- -------------------------
H. Compliance Cape is - Geographic - Cape's Please Accountability/Audit
and business exposed expansion values see page Committee
conduct to the - Broaden drive 36 of report
risk risk of portfolio a culture the 2016 Pages
non-compliance - Operational where Annual 60-64
and breach excellence integrity, Report
of honesty For further
applicable and information
laws and compliance of Cape's
regulations are an corporate
including integral responsibility
anti-bribery part of please
and anticorruption, day-to-day refer
health business to our
and safety at all website
regulations levels www.capeplc.com/
and sanctions. - Global corporate-responsibility
whistleblowing
Laws and procedures
regulations in place
are increasing - Documentation
and their of key
reach operational
is extending. and administration
Forthcoming policies
UK legislation and procedures
will include: are available
data protection; to the
modern majority
day of the
slavery; Company's
gender employees
pay analysis; on the
and export Cape Management
controls. System
- Senior
A lack managers
of detailed within
knowledge each of
of relevant the Group's
legislation business
across units
the countries certify
we operate detailed
in could questionnaires
result covering
in a breach their
of law unit's
or regulation. business
conduct
and regulatory
compliance
every
six months
- Anti-bribery
and anti-corruption
policies
and training
is
provided
globally
- Investment
in training
to improve
the compliance
knowledge
of staff
is being
led by
the Group's
legal
department
- Compliance
is monitored
by the
relevant
Group
functions
including
Tax and
Treasury,
Legal,
Finance,
and HSE
---------------- --------------------- --------------- --------------------- ---------- -------------------------
I. Industrial Cape receives - Operational - The Please Note 2
Disease claims excellence court-approved see page 'Summary
Claims from individuals 2006 Scheme 36 of of significant
(IDC) and insurance of Arrangement the 2016 accounting
- provision companies protects Annual policies'
adequacy in the Report Note 4
risk relation interests 'Significant
to the of future judgements
historical IDC claimants and estimates'
alleged whilst Note 29
exposure at the 'Provisions'
to asbestos. same time Note 34
There protecting 'Industrial
is a risk the Group disease
that Cape from the claim
materially impact provision
underestimates of extreme and
the IDC adverse contingent
funding change liabilities'
requirement in the
due claims
to inherent environment
uncertainty - Triennial
associated valuation
with the of the
future IDC liability
level carried
of asbestos out by
related external
IDC and actuaries
of the using
costs the Group's
arising cumulative
from such claims
claims. history
and updated
economic
assumptions
- Recent
valuation
produced
favourable
trends
and reduces
the
risk profile
of the
liability
- Annual
review
carried
out by
external
actuaries
and external
auditors
of Cape's
accounting
note on
the valuation
of IDC
- Half
yearly
review
of economic
assumptions
by the
Board
- Dedicated
internal
Legal
function
and external
claims
handlers
and specialist
legal
advisors
proactively
manage
cases
and monitor
changes
in the
legal
environment
---------------- --------------------- --------------- --------------------- ---------- -------------------------
J. Industrial Legal - Operational - Recent Please Note 2
Disease precedent excellence agreement see page 'Summary
Claims in this to settle 38 of of
(IDC) area is insurer the 2016 significant
- widening constantly product Annual accounting
of the evolving liability Report policies'
scope and the claims Note 4
and Group substantially 'Significant
liability is reduces judgements
subjected the risk and estimates'
to new to the Note 29
claim business 'Provisions'
types in this Note 34
over time. area 'Industrial
These - Regular disease
may give Board claim
rise to review provision
uncertainty of IDC and
in both litigation contingent
the future - Dedicated liabilities'
level internal Note 39
of asbestos-related Legal 'Post
IDC and function balance
of the monitors sheet
legal changes events
and other in the
costs legal
arising environment
from such - Specialist
claims. external
legal
and other
advisors
engaged
---------------- --------------------- --------------- --------------------- ---------- -------------------------
K. Tax We operate - Geographic - Cape's Please Note 2
and treasury across expansion values see page 'Summary
risks a number - Customer drive 38 of of significant
of economies intimacy a culture the 2016 accounting
and jurisdictions - Broaden where Annual policies'
which portfolio integrity, Report Note 12
therefore honesty 'Income
exposes and tax'
the Group compliance Note 20
to a range are an 'Deferred
of tax integral income
laws that part of tax'
vary significantly day-to-day Note 28
and are business 'Current
rapidly at all income
evolving levels tax liabilities'
toward - Tax Note 34
global policies 'Industrial
transparency and procedures disease
and are regularly claim
harmonisation. updated, provision
The Group with the and
is required Group's contingent
to interpret tax strategy liabilities'
laws and to be
treaties published
and must online
manage in 2017
its tax - Embedded
affairs tax expertise
within in all
these major
laws or businesses
else risk along
incurring with central
fines Group
and/or Tax team
charges support
from the - Ongoing
tax authorities. reviews
Taxation conducted
regimes by the
are increasingly Group
co-ordinating Tax and
and tightening Legal
with 'base team to
erosion monitor
and profit compliance
shifting' - External
rules advisors
and equivalent are used
regulations. to support
In some local
cases, teams
tax legislation on specific
or rules tax matters
are not including
clear legal
and the opinion
Group when requiring
may disagree interpretation
with the of tax
tax legislation
authorities. and principals
If this - Active
is the engagement
case, with relevant
then it tax and
may be government
necessary authorities
for court - Debt
involvement exposures
to interpret are monitored
the laws. during
contract
The treasury lives
related and firm
risks operational
faced decisions
by Cape are taken
include when limits
client are approached
and bank or breached
credit - Bank
risk and creditworthiness
foreign and relationships
exchange are monitored
risk. by
The credit Group
risks Treasury
faced - Business
by Cape units
vary by endeavour
geography, to balance
but are revenues
currently and costs
highest in
in oil matched
based currencies
economies wherever
with developing possible
financial - Group
systems, Treasury
non-investment will hedge
grade higher
banks currency
and where risk exposures
our clients if required
may be
local
sub-contractors
with delayed
payment
practices.
---------------- --------------------- --------------- --------------------- ---------- -------------------------
L. IT-system The IT - Geographic - A variety Please
and cyber risks expansion of cyber-attack see page
risks faced - Operational monitoring 38 of
by Cape excellence and response the 2016
include software Annual
increasing has Report
cyber been implemented
risks, - Design
increasing and development
data and of the
network global
protection ERP system
requirements, that will
business significantly
continuity/disaster standardise
recovery operations
considerations and processing
and ageing across
legacy all of
systems Cape
which - Consolidation
will be of payrolls,
gradually where
transitioned practicable
to a new - General
robust data protection
global regulation
ERP system. readiness
planning
has commenced
- Data
categorisation
and classification
is underway
- Global
review
of business
continuity/disaster
recovery
plans
- Development
of plans
to regularly
test and
gradually
migrate
payrolls
to a cloud
based
solution
- Email
systems
have been
migrated
to Office
365
---------------- --------------------- --------------- --------------------- ---------- -------------------------
Viability statement
In accordance with the UK Corporate Governance Code, the
directors have assessed the prospect for the Group over a longer
period than the twelve-month going concern provision.
The directors' assessment of the Group's prospects for the
three-year period is based on the review and analysis described
below. The directors consider this to be a reasonable process which
therefore allows them to form a reasonable expectation of the
Group's prospects in the circumstances of the inherent uncertainty
of a three-year period. The time period was selected to represent
the duration of the Group's contract base, with construction
contracts having a typical duration of two to three years, while a
change in provider for maintenance contracts takes around one to
two years. Additionally, the revaluation of both the IDC and
pension liabilities takes place on a three-year cycle.
The Group performs a strategic review each year, in which the
Board reviews Cape's current position, strategy and risks and
opportunities alongside current and expected market conditions and
trends. Our viability assessment was based upon the Group's
strategy and planning information and assessed the discrete impact
of each individual selected principal risk, with the impact from a
number of these risks also assessed on a combined basis. This
analysis considers cash flows, covenant projections and liquidity
and other key financial measures over the period. The selected key
risks against which the strategy model has been stress tested are
those that management considers could affect the future viability
of the Group. These risks are highlighted on pages 34 to 39 and
included the following: political and security instability in one
region; acceptance of a new contract with unfavourable terms; poor
operational performance on an existing contract; new scope of
liability relating to IDC, with additional assessment undertaken on
the timing of the resulting cash flows; loss of a key customer and
an increase in interest rates and tax liabilities.
Based upon a robust assessment of the principal risks to the
Group's prospects and consideration of the duration of the Group's
contract base and the projected timing of IDC and pension outflows,
the directors concluded that there is a reasonable expectation that
the Group will be able to continue in operation and meet its
liabilities as they fall due over the three--year assessment
period.
Appendix 3: Related party transactions
Details of directors' emoluments are shown in note 36 'Related
party transactions' to the consolidated financial statements and in
the Directors' Remuneration Report on pages 65 to 77 of the 2016
Annual Report.
There have been no material transactions with the Company and
other related parties during the year.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACSUVRBRBNASRAR
(END) Dow Jones Newswires
April 06, 2017 02:00 ET (06:00 GMT)
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